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Friday, 6 June 2014

More than
£1.3bn of bogus insurance claims were detected in 2013 according to figures
published today by the Association of British Insurers, with claims car
insurance making up a majority of this amount.

Insurers detected a total of 118,500 fake or
exaggerated insurance claims, equivalent to 2,279 a week across the year. The
average fraud detected across all types of insurance products was £10,813.

Fraudulent
motor insurance claims were the most expensive and common, with the number of
dishonest claims at 59,900 claims up 34% on 2012 and their value up 32% to
£811m.

So-called
‘cash for crash’ schemes, where fraudsters stage car smashes on unsuspecting
motorists and claim for the damage and injuries, represent approximately £120m
of financial exposure to insurers, the report concluded.

However, the
number and value of property insurance frauds fell, down 38% by £137m on 2012.

Aidan Kerr,
head of fraud at the ABI, said: ‘Insurance fraud is not a victimless crime,
which is why the industry invests £200m a year in fraud detection, including
funding the Insurance Fraud Enforcement Department, and developing the
Insurance Fraud Register, a central database of known insurance cheats.

‘The more
that is done to crackdown on the dishonest, the quicker and more effectively
insurers can deal with the claims from the honest majority.’

The
Insurance Fraud Bureau, which was created in 2006 to tackle these organised
scams, is currently supporting police forces and insurers investigate 110 of
these crimes, throughout the UK.

In one case,
60 people were convicted of a ‘crash for cash’ stage accident which involved
more than £514,000 being claimed from 25 vehicle crashes alone.

Last week a
bus company was forced to scrap a bus route after it was targeted by ‘cash for
crash’ fraudsters 15 times in two years.

The ABI
added that since 2007 the value of dishonest general insurance
claims detected has more than doubled, with the number detected rising by 30%
over the same period.